manging for innovation
DESCRIPTION
The what, why and how of managing innovation in a business contextTRANSCRIPT
MANAGING 4
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What is innovation?Innovation is the process of turning opportunityopportunity into new ideasnew ideas and putting those into widely used practicewidely used practice – Tidd, Bessant & Pravitt – Managing Innovation (2001)
Innovation is the means by which entrepreneurs exploit changeexploit change as an opportunityopportunity for a different businessbusiness or serviceservice – Peter Druker – Innovation and Entrepreneurship (1985)
Innovation is the successful exploitationexploitation of new ideasnew ideas – UK DTI Innovation Unit
What is innovation?
Opportunity Idea Exploitation = Innovation+ +
Product Innovation
Improving the features of a product or creating new products
Process Innovation
Improving or changing the process by which a product or service is produced or delivered
Business Concept Innovation
Radically reconceiving products and services, not just developing new products / servicesRedefining market spaceRedrawing industry boundaries
WWHHYY??
Encyclopaedia Britannica’s 225 year track record of success was destroyed in:
• 24 months• 5 years• 10 years• 25 years
Encyclopaedia Britannica’s 225 year track record of success was destroyed in:
• 24 months• 5 years• 10 years• 25 years
What has more computing power?
• Dell 400 Mhz Pentium III desktop PC• Apollo 11 mission control computer• Sony Playstation
What has more computing power?
• Dell 400 Mhz Pentium III desktop PC• Apollo 11 mission control computer• Sony Playstation
It took the telephone 40 years to penetrate 10 million homes. How long did it take the
Netscape browser?
• 18 months• 5 years• 10 years
It took the telephone 40 years to penetrate 10 million homes. How long did it take the
Netscape browser?
• 18 months• 5 years• 10 years
How many people use the internet in China?
• 50 million • 200 million • 300 million
How many people use the internet in China?
• 50 million • 200 million • 300 million
Value of Yahoo!’s offer to buy Facebook.com from the 22 year old
founder, Mark Zuckerberg
• $100 million• $1 billion • $500 million
Value of Yahoo!’s offer to buy Facebook.com from the 22 year old
founder, Mark Zuckerberg
• $100 million• $1 billion • $500 million
3 billion people live in Asia. What proportion of the population is < 25
years old?
• 20%• 35%• 50%
3 billion people live in Asia. What proportion of the population is < 25
years old?
• 20%• 35%• 50%
The cost of hiring an English speaking PhD chemist in India is:
• R65,000 pa• R150,000 pa• R350,000 pa
The cost of hiring an English speaking PhD chemist in India is:
• R65,000 pa• R150,000 pa• R350,000 pa
The average consumer in the developed world is hit with how many marketing
messages every day?
• 500• 2500• 4500
The average consumer in the developed world is hit with how many marketing
messages every day?
• 500• 2500• 4500
General Motors makes more money from?
• Selling cars• Selling technology• Lending customers money to buy its
cars
General Motors makes more money from?
• Selling cars• Selling technology• Lending customers money to buy its
cars
Number of Apple iPods sold to date?
• 10 million • 35 million• 100 million
Number of Apple iPods sold to date?
• 10 million • 35 million• 100 million
Google’s value at IPO, 6 years after the business was founded?
• 32 billion • 20 billion• 12 billion
Google’s value at IPO, 6 years after the business was founded?
• 32 billion • 20 billion• 12 billion
HHOOWW??
4 businesses
4 case studies
4 management philosophies
4 innovation models
Methodical Innovation
Observe Brainstorm ImplementPrototype
ObserveIDEO’s cognitive psychologists,
anthropologists, and sociologists team up with corporate clients to understand the
consumer experience
Ideo
BrainstormAn intense, idea-generating session
analyzing data gathered by observing people. Each lasts no more than an hour. Rules of brainstorming are strict and are
stenciled on the walls.
Ideo
PrototypeMocking up working models helps
everyone visualize possible solutions and speeds up decision-making and
innovation.
Ideo
ImplementBring IDEO’s strong engineering, design,
and social-science capabilities to bear when actually creating a product or
service.
Methodical Innovation
• Process to drive innovation• Fun environment• Diverse teams• Encourage failure
Application
Facts about P&G
• 167-year-old business
• $50 billion in sales
• 300 brands • 160 Countries • 13 brands in
excess of $1 billion
P&G History of Innovations
How do they keep this going?
P&G Response = R&D
But still not getting the innovation they want?
• R&D Spend – $1.6 billion• 7,200-strong R&D staff• Over 1000 PhD’s
Open Innovation R&D
C&D [Connect & Develop]
[Research & Development]
Source: P&G Connect and Develop Booklet: http://pg.t2h.yet2.com/t2h/page/homepage
Connection network
Source: P&G Connect and Develop Booklet: http://pg.t2h.yet2.com/t2h/page/homepage
Our vision is simple. We want P&G to be known
as the company that collaborates - inside and
out - better than any other company in the
world.
I want us to be the absolute best at spotting,
developing and leveraging relationships
with best-in-class partners in every part of
our business. In fact, I want P&G to be a magnet
for the best-in-class.
I have a ready-to-go product or technology to offer P&G
I want to acquire a technology from P&G.
Ready-To-Go ProductsBy acquiring the newly introduced SpinBrush,
P&G was able to bring a superior oral care brand to
market quickly, without undertaking the time and
expense of developing an entirely new product.
Ready-To-Go PackagingConsumer-preferred pump dispensers were originally developed by a European packaging products company. P&G led a collaborative improvement process to make the original pumps more effective prior to their launch in Olay’s North American markets.
Open Innovation
Ready-To-Go TechnologiesP&G introduced Bounce, the world’s first dryer-added softener, after acquiring the product technology from the independent inventor who developed the innovative fabric-care solution.
Open Innovation
Commercial PartnershipsP&G found the perfect complement to the Swiffer
brand in a hand-held duster developed by a Japanese competitor. After purchasing the product, P&G leveraged elements of existing manufacturing
processes and advertising components to launch Swiffer Duster within 18 months.
Open Innovation
Application
• Know where to look• Leverage networks• Distribute and screen ideas • Promote openness to external ideas
MSA
Vitality
Discovery Life
Discovery CardDestiny Health
Discovery World
1994 2006
Innovation History
Driven Innovation
"We don't innovate for innovation's sake, but without a deadline that fine line between a great product and a mediocre product is seldom bridged.”
Adrian Gore – CEO Discovery
• Set a deadline• Short planning cycles:
18 months to 3 years• Link product and
process innovation• Combine intellect &
emotion
Pet Project Innovation
“We call all of these projects Googlettes. Basically, they're baby Googles, startups within the startups. We really like the concept because it helps us keep that innovative startup feel and launch projects quickly.”
Marissa Mayer - Director Consumer Web products at Google
Pet Project Innovation
• Free time• Access to upper managers• Top 100 priorities list• Small teams
Application
Where will Google go next?
Open Innovation
Driven Innovation
Pet Project Innovation
Methodical Innovation
Consistent Themes?
Consistent Themes
• Leadership• Teamwork• Values • Stimulation • Recruitment
Open Innovation
Driven Innovation
Pet Project Innovation
Methodical Innovation
